FRM Capital Advisors, the seeding division of Financial Risk Management, has entered its first strategic relationship with an Asian hedge fund.
FCA will make a significant investment in the first fund to be launched by Isometric Capital Management, owned and managed by Sanjiv Bhatia, the former head of Deephaven Capital Management’s Asia office.
The fund will use a fundamental research strategy to identify investment opportunities in Asian companies where it can identify a catalyst which will drive investment returns. The fund will invest predominantly in equities although positions will range across the capital structure.
The fund is expected to launch at the beginning of December with between USD50m and USD75m of assets under management.
Neil Mason, chief investment officer at FCA, says: "This deal reinforces the global nature of FCA’s business and is the first investment we have made outside of the US and Europe. Asia is an important focus in our manager research. Asian economies have shown their strength and there are numerous market inefficiencies that hedge funds can profit from. The industry has grown significantly in recent years and there are a number of high quality managers with interesting investment strategies."
Bhatia adds: "As a new hedge fund, this major investment by FCA allows us to focus all our energies on operational excellence and generating high quality returns for our investors.
"Asian markets are changing constantly, with periods of significant volatility, as well as opportunity. Our holistic approach to fundamental research across the entire capital structure, combined with a long investment history and solid risk management, allows us to have low correlation to markets and protect against downside volatility whilst capitalizing on opportunities for our investors.
"This strategic relationship with FCA is a major endorsement of the investment principles and business ideals of the people at Isometric."
Isometric is the third seeding deal announced by FCA in the past four months having previously agreed strategic relationships with JD Capital and WestSpring Advisors.